(a) Explain what the companies should đo with their proits, onditional to the vailability of absence of highly profitable investment opportunities.
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- 4a) Explain what the companies should do with their profits, conditional to the availability or absence of highly profitable investment opportunities.Does the successful investment decision increase a company's market value?ASAP What is more important for a firm–profit maximization or value maximization? What issues orconflict of interest can come up between owners and managers and how can they be solved?
- If a company is looking for an investment opportunity, they should be able to demonstrate how they would go about doing so.Should a firm’s managers help investors improve their estimates of the firm’s intrinsicvalue? Explain.What are two crucial presuppositions we make when we choose to use the present cost of capital of a firm to evaluate the profitability of projects in which we invest? Be thorough.
- Which of the following is not a determinant of investment? a) The efficiency of capital equipment b) The level of consumer demand c) Interest rates d) The willingness of investors to buy new share issuesTo measure the financial viability of a proposed business, which is the more powerful measure- profitability, liquidity, solvency or payback period? Support your answer with clear examples.Is it feasible for a new company endeavor to be lucrative while also experiencing financial difficulties?
- Which of the following considers both time value and risk factor of the business concern? a. Sales Maximization b. Asset Maximization c. Profit Maximization d. Wealth MaximizationIs it realistic to believe that an optimal capital structure exists or might be achieved by a company?A statement of financial position allows investors to assess all of the following except the___. WHICH OPTION IS CORRECT? a. capital structure of the enterprise b. liquidity and financial flexibility of the enterprise c. efficiency with which enterprise assets are used d. net realizable value of enterprise assets
